Recently, Coinbase, the largest cryptocurrency exchange in the United States, made a special request to the U.S. Securities and Exchange Commission (SEC) to clarify new cryptocurrency regulations. However, the SEC has yet to decide on its course of action regarding Coinbase’s petition for rulemaking.
This follows an order from Judge Cheryl Ann Krause of the U.S. Court of Appeals for the Third Circuit, requiring the SEC to disclose whether it intends to deny Coinbase’s petition. The filing by Coinbase, submitted last year, aimed to seek clarity from the SEC on classifying assets as securities and regulating digitally native securities.
Paul Grewal, Coinbase’s Chief Legal Officer, expressed his concerns on Twitter, stating that the SEC is falsely claiming that no decisions have been made regarding new crypto rules. He further criticized the SEC for refusing to commit to a deadline, disregarding the explicit order from the court.
Meanwhile, the SEC has filed a lawsuit against Coinbase, accusing the exchange of operating as an unlicensed securities exchange and prioritizing profits over investor interests. SEC Chairman Gary Gensler has been leading the extensive crackdown on the cryptocurrency industry, asserting that, apart from Bitcoin, all digital coins and tokens should be considered securities. Before the lawsuit against Coinbase, the SEC also brought 13 civil charges against Binance, its American sister exchange Binance US, and their CEO Changpeng Zhao.
This year, the SEC has increased its regulatory efforts by targeting other prominent American digital asset exchanges, such as Kraken and Gemini, alleging the sale of unregistered securities.
Chairman Gensler, who assumed the role in 2021, has expressed skepticism toward the cryptocurrency industry, stating that the United States does not need additional digital currencies. He has emphasized that the digital asset space was built on a foundation of non-compliance.
The ongoing deliberations by the SEC on Coinbase’s rulemaking petition carry significant implications for the crypto industry. Market participants eagerly await further clarification on the classification and regulation of digital assets, hoping for a more inclusive and well-defined regulatory framework. Consequently, the SEC’s decision will undoubtedly shape the future of cryptocurrencies in the United States.
These developments highlight the pressing need for collaboration between industry participants and regulatory authorities to foster innovation while ensuring investor protection. As the crypto ecosystem evolves, balancing regulation and technological advancements remains a crucial challenge for regulators and market players.